Shares of Sun Pharmaceuticals retreated from 52-week high hit in the previous trading session after the drug maker surprised investors by reporting pre-tax loss during the April-June quarter.
Consolidated net loss stood at Rs 1,655.6 crore in the June quarter, primarily dragged by a one-time settlement in a drug price-fixing case in the US by its subsidiary Taro Pharmaceutical Industries. In the year-ago quarter,
India’s largest drugmaker had posted a profit of Rs 1,387.5 crore.
Taro reported settlements and loss contingencies of $478.9 million (about Rs 3,178 crore), which reflect the one-time settlement charge of $418.9 million related to the global resolution of the Department of Justice investigations into the US generic pharmaceutical industry.
The subsidiary made an additional provision of $60 million, or about Rs 455.2 crore, for the ongoing multi-jurisdiction civil antitrust matter.
While the losses were primarily due to an overall one-time charge of Rs 3,633 crore, Sun Pharma also had a poor quarter as the covid-led global lockdown across markets led to tepid sales, especially in the US market.
The Dilip Shanghvi-led drug maker clocked Rs 7,467 crore in consolidated sales from operations, down 9.6% on-year, reflecting the impact of the global covid-19 pandemic and consequent lockdown across markets and is not an indicator of the underlying strength of its business.
Sun Pharma’s fared reasonably well in the overseas markets. Formulation sales in the US were down by a third to
$282 million. Sales in emerging markets, as well as the rest of the world, were also lower on account of the pandemic. However, the Indian market, accounting for 32% of sales, grew 3% to Rs 2,388 crore.
Sun Pharma’s gross margin has come at 74% and EBITDA margins at 24.3%
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